Written By: Sean Collar
If I were to give you $10,000 and tell you to invest it, most people would not know how to do so, but for those who do, most would choose a variety of stocks. Stocks are shares (very small percentages) of their company that they sell to the public. Once purchased, you now own a very small percentage of the company and take in all gains and losses as the stock price moves. Sure, it is great to diversify your investments across multiple companies and industries, but even better is diversifying your money across different types of investments. Most millionaires have their money in several different investments such as index funds, real estate, dividend stocks, art, gold, business investments, and now, the growing crypto market.
With a rapidly developing world comes new technology and new everything. A new investment: Cryptocurrency. Cryptos are very complex when it comes to understanding where they come from and exchange, but the price of a crypto is seen similar to a stock price. When a crypto is in demand, the price goes up, and when otherwise, goes down. Cryptos are meant to be used as a currency used in transactions, but many treat them as an investment. There are thousands of cryptos available to invest in, but some of the main ones are Bitcoin, Ethereum, Litecoin, Monero, and Dash. Bitcoin is the “gold” of the crypto market. It’s price currently sits around $8,000, while 5 years ago it’s price was at $300. In December of 2017, Bitcoin even hit $19,000. Yes, cryptos are extremely volatile, but the market itself is so new, and yet to be discovered by many. This lack of education in investors means there is tons of upside to an investment in crypto. Cryptocurrencies WILL grow long term because of their future applications to everyday life.
You may be wondering where you can start buying cryptos. There are two amazing options. First, the simpler of the two, which is Coinbase. Coinbase is for beginner crypto investors. It is a smartphone app and the fees are $0.99 per transaction. For me, I invest in cryptos for the long term, so the fees are not a big problem considering I am only buying. Coinbase has a great, sleek look, and is very easy to navigate. It is straightforward, and there are several cryptos available to buy.Next is the Binance, which was just released in the United States. Binance dominated the crypto markets in the rest of the world, and they even have their own cryptocurrency now, named “Binance Coin”. Binance US has is now a smartphone app, and is great for more advanced investors, or those who wish to have a larger selection of cryptos. Unlike Coinbase, Binance does not have any fees, but rather added into the price of the coin you are purchasing. Binance is more complex to use, and on top of placing orders at the market price, you can set buy/sell stop and limit orders which make trading easier for advanced investors.
I personally use both Coinbase and Binance, and love them both in different ways. Like most, I started with Coinbase, and moved to Binance after 6-12 months of investing. I suggest you do the same, getting your feet wet with Coinbase, then further your ventures with Binance. However, if you wish to start investing in cryptos, here are the TEN that I researched a couple months ago and have been buying weekly with consistent gains:
- Bitcoin (BTC)
- Binance Coin (BNB)
- Ethereum (ETH)
- Litecoin (LTC)
- Ripple (XRP)
- Stellar Lumens (XLM)
- 0x (ZRX)
- Chainlink (LINK)
- Cardano (ADA)
- Basic Attention Token (BAT)
***Next to the name is the ticker used on trading apps/websites***
Buying all 10 of these would be similar to diversifying your stock market purchases; reducing risk in a high risk investment, while staying risky. Now is a great time to start investing, especially in cryptos. It is a high risk, high yield investment. This means that you should not put all of your money in cryptos, but a portion of your assets should be in them. If you want a shot at becoming a millionaire before you are old and retired, take on some riskier investments. The cryptocurrency market has so much upside and potential. The car company Ferrari accepts bitcoin to purchase their cars. With the outbreak of the Coronavirus, you can see where paper money is flawed in that people could be worried about germs on the bills. Enter cryptocurrencies, a worldwide network of currency, decentralized and available to everyone worldwide.
Works Cited
Kuffel, Hunter. “How (and Where) To Invest In Cryptocurrency.” SmartAsset, SmartAsset, 15 Jan. 2020, smartasset.com/investing/how-to-invest-in-cryptocurrency.Rohan, et al. “Nine Investing Strategies Millionaires Use to Accumulate Wealth.” ESI Money, 30 Dec. 2019, esimoney.com/nine-investing-strategies-millionaires-use-to-accumulate-wealth/.
I remember Bitcoin was really talked about during sophomore year, but no one really knew what this cryptocurrency or any others could really do for you. The price fluctuates a lot but I think this would be a smart way to diversify your investing portfolio.
ReplyDeleteI haven't ever really looked into these currencies and got a full understanding of them, but all of the information you shared was really valuable. Its interesting how you can get pain with bitcoins and pay people with them but its not like it something you can take to a store and but groceries with. I do know a few people who have them and they seem like they love using it and make money from it, but i'm not sure if I would want to invest in them.
ReplyDeleteI haven't been hearing a lot about bitcoin and other currencies in the recent, especially due to the noise of the stocks with the outbreak. Therefore, it is a very good idea to transition over to investing in the technological investment system. I never really thought about it, but it sounds like a great idea that I might want to try.
ReplyDeleteI have heard a lot about investing in cryptocurrencies for the past couple years because there is some big money to be profited in it. I have thought about investing myself but I have never been sure how to do so. After reading this article I think I will start soon and use the tips and apps listed above. Overall this was a great article to read and also a great guide to starting on your own. Nice Job
ReplyDeleteAs a fellow investor, I also see the importance of cryptocurrencies. However, with the volatility associated with these unregulated financial instruments it is hard to understand the true market. I do feel though that having a centralized, online currency will only be growing in the future. Sean, I love the topic. Good Job.
ReplyDeleteI've known about cryptocurrency for a while now and have been interested in getting into it, your article was very helpful in informing a beginner on how to get into the crypto game. It is interesting to think how cryptocurrency provides an alternative to cash, especially in times like these where a virus could be carried on physical currency. Thank you for sharing your wisdom about cryptocurrency and you did a very great job at writing this informative piece.
ReplyDeleteI've always heard about cryptocurrency, more specifically, how people have made a lot of money from investing in it, but another thing I've heard is that it can be very, very unstable. But then again, the stock market is also very unstable (just look at how the coronavirus is sending stock prices plummeting down), so I suppose they're very similar. Besides the point, it feels like cryptocurrency is just another form of stocks-- I rarely see it being used as a real currency, except for how people buy illegal things online with bitcoin. Still, this is a very interesting topic, and a very informative post.
ReplyDeleteAs a non-investor, I now see how I can get started if I choose to do so. Obviously the $0.99 per transaction can build up but that is based off of how much you choose to participate in stocks. I also now know what cryptocurrency is based off of this article.
ReplyDeleteI almost thought that I had missed the boat for crypto-currencies after bitcoin boomed in 2017. However, I am able to see your viewpoint and how this is a very good option to bu into now, where the high risk will be less of a factor because by the time we reach the age of retirement, or later in life when we wish to access our savings, the net growth from these investments will likely be much higher than any other investment. Likewise, having a smartphone app and streamlined design makes it very easy to get into now, in our teenage years, and access even more long term benefits that are sometimes neglected in traditional investments.
ReplyDeleteA very interesting topic, and an interesting opinion. Reason being that it is more rare, especially with the people who think they know a lot about investing but really don't. The path is that beginners invest in crypto, intermediates stray away from it entirely, and the experts go back to crypto. Many in our school are the aforementioned intermediates that don't realize the potential of this medium, instead look at the volatility and stray away from it. This article defies the trend with justification, and shows the depth that it possess. You may want to talk about data degradation and how it increases the value of cryptos. Another constructive criticism is that you did not talk about robbing hood that allows you to trade without paying a fee to them. Other than that your article was great.
ReplyDeleteI enjoyed the article as an introduction, however buying crypto outright isn't the only method, and I'm surprised you didn't mention it: mining. People building computer rigs specifically for accumulating cryptocurrency. While this has fallen off the radar as of late, it still surprises me that it wasn't brought up in this article. Furthermore, to put more foundation under your claims, I would detail what you've gained instead of just saying you've had "consistent gains".
ReplyDeleteIt's crazy how that while the media and social craze and frenzy around cryptocurrencies has since faded, there still is significant upsides to them. I know you as a friend and businessman, and I take your financial advice seriously. This is a really cool article that balanced and compartmentalized the problems of cryptocurrencies (volatility, lack of education, new market), with potential benefits of those some problems (high yield, similar playing field, use in daily life gives market security).
ReplyDeleteI found this article very interested and this might be something I would want to look into in the future. This reminds me of bitcoin a few years ago when it was a huge thing and everyone was looking into it. It sounds like you are very knowledgeable with this stuff and I definitely will contemplate asking you more about this because it sounds like something that many people are missing out on.
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